GP indemnity costs will remain high despite proposed cap on lawyer fees

Proposed cost limits on lawyer fees for personal injury claims will 'make very little difference' to pay-outs and GP indemnity fees, medico-legal organisations have warned.

Medical defence organisations say that plans to cap lawyer fees will not have a meaningful impact on the spiralling cost of personal injury claims – unless they are expanded to include higher-cost cases.

It follows the conclusion of a DH consultation on introducing fixed recoverable costs for lower value clinical negligence claims, launched in January.

The consultation proposed a cap on lawyer fees for clinical negligence cases where pay-outs ended up between £1,000 and £25,000 in value.

The latest warning over the likely impact of a cap comes as the Medical Protection Society found 75% of the public want to reduce the amount of money lawyers are able to claim from the NHS in legal cases for clinical negligence.

The MDU warned that the NHS was being ‘brought to its knees’ through the ‘relentless and rising tide of litigation’.

It said the cap should be applied to all claims settled up to £250,000 in order to have ‘any meaningful impact’ in the short term – although ‘root and branch reform’ of personal injury was required in the longer term.

Personal injury

Dr Matthew Lee, MDU professional services director, said: ‘In many of the thousands of lower value clinical negligence claims settled each year, more money goes towards paying lawyers than compensating injured patients and that cannot be right.

‘The caps proposed are only for claims where compensation paid is between £1,000 and £25,000. The cost of these claims is only a small percentage of the total clinical negligence bill and caps at this level would make very little difference to the overall picture.

‘We strongly believe that fixed costs should be applied to all claims settled up to £250,000 to have any meaningful impact.’

The MDDUS said it had been ‘disappointed’ that the proposed caps only included claims up to £25,000.

The current system ‘perversely incentivises lengthy and distressing proceedings’ and ‘encourages the pursuit of unmeritorious claims’, it added.

‘We urge the government for a firm and swift commitment to increasing the upper limit to £250,000,’ its chief executive officer Chris Kenny said.

‘Reform is vital to ensure that public funds, and the subscriptions of our members, are properly directed towards compensating wrongly-injured patients promptly and proportionately; rather than generating ever-increasing activity by claimant law firms.

Lawyer costs

‘It is our view that the distortion in the ratio between damages and claimant costs levels is having an adversely disproportionate and harmful effect, particularly, but not exclusively, in the lower value claims.’

The Medical Protection Society said it had seen cases where legal costs came to over eight times the amount awarded in settlements.

Director of claims Emma Hallinan said: ‘We fully support the introduction of mandatory fixed recoverable costs for claims of clinical negligence, and we understand the argument for not capping legal costs for the most expensive and complex claims, but we believe it is appropriate and viable to include claims up to £250,000.

‘This scheme presents an opportunity to create a more proportionate, fairer system while generating significant savings to the NHS – it is an opportunity that should not be wasted. We urge government to listen to the strong views of the public and be bold when making its decision on the threshold.’

Photo: JH Lancy

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